Money, Speech & Politics:

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Current Issue :
2009 Spring

HEADS THEY WIN, TAILS THEY WIN

That the real purpose of campaign finance rules is to protect incumbents should be no surprise. First, of course, incumbents are the ones who write the rules, giving them an opportunity to stack the deck in their favor. In almost any other aspect of public life, this inherent conflict of interest would be recognized, and the resulting action viewed through this lens. But surprisingly little commentary about the federal campaign finance laws—the Federal Election Campaign Act of 1971, the major 1974 amendments to the FECA, and the Bi-partisan Campaign Reform Act of 2002, popularly-known as the McCain-Feingold law—has addressed this obvious issue when considering the legitimacy of these rules.

Second, almost every key provision of those laws seems to have been designed to benefit and entrench incumbents. Spending limits and contribution limits —the keystones of all modern campaign finance "reforms"—are both of great assistance to incumbents; they reduce the amount of money that challengers can raise and spend and thus magnify the advantages of incumbency. These advantages include, among many others, appropriated funds for staffs, free communications to the state or district, constituent services, name recognition, access to and coverage from local media, and backing from interest groups eager to aid and support an incumbent with the power to do good or ill. Sweeping disclosure provisions discourage individuals from supporting challengers for fear of reprisals from incumbents.

The proof of the incumbency-protective nature of campaign finance limits is there in the numbers. Since the enactment of the FECA in the early 1970s, the reelection rate of congressional incumbents has increased steadily, and in the last twenty years it has often reached more than 98 percent. Similarly, the amount of money raised by challengers has, relatively speaking, declined, so that the incumbent-to-challenger funding ratio, which was 3 to 2 before FECA, has increased to approximately 5 to 1.
So the result of greater campaign finance controls, supposedly passed to "level the playing field," has been to entrench incumbents and enhance their fundraising advantage over challengers.

Because many of the inherent advantages of incumbency cannot be eliminated—they are a part of the important process of communication between an officeholder and his or her constituents—a truly competitive system should at least provide the potential for challengers to spend more than incumbents in elections. The place where limits pinch most is precisely in the competitive elections where challengers —if they are allowed to raise and spend sufficient funds to mount an effective campaign against an incumbent—have a decent prospect of winning.

If challengers are to have at least the potential to raise more funds than incumbents, where are these funds to come from? Under the current campaign finance regime, contribution limits make it much more difficult for challengers to raise funds than incumbents; indeed, the gap between incumbent and challenger fundraising is widening. The only logical and consistent source of challenger funding is the political party. Parties alone have the ability and the incentive to provide to challengers the early funding— and the necessary financial support overall —that will give them a chance to overcome the inherent advantages of incumbents. Accordingly, if our goal is a more competitive electoral system, restrictions on parties, more than any other element of our current campaign finance structure, must be eliminated. Only through this change in policy can we be assured of a competitive electoral system in the future.

Critics of the current campaign finance system generally fall into three camps: those who favor more extensive regulation of private funding; those who propose expanded and perhaps even exclusive public funding; and those who advocate extensive deregulation and argue that the First Amendment alone should govern campaign finance, reasoning that the current regulatory regime is inconsistent with constitutionally protected speech or has otherwise failed to achieve its claimed objectives. A party-oriented approach falls into none of these camps; it proceeds from the assumption that the contribution limits in current law will remain, but it avoids or eliminates the adverse effects of these limits by freeing the political parties to become the principal financing sources for their candidates.

Parties alone have the ability and the incentive to provide to challengers the early funding—and the necessary financial support overall—that will give them a chance to overcome the inherent advantages of incumbents.